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As it braced for a new president and questioned where he’d take the economy this year, the DC region ended 2024 with a bang thanks to one multi-billion dollar raise standing above the rest.
Companies in the DMV saw $3 billion of venture capital invested across 50 deals in Q4 — a high jump from a comparatively sluggish $478.3 million across 64 deals in Q3, according to the latest quarterly Venture Monitor report from PitchBook and the National Venture Capital Association.
This amount makes last quarter the region’s highest-performing one in recent memory. Tallies surpassed $1 billion in 2023’s second and third quarters, but did so through more transactions: Q2 2023 boasted $1.2 billion across 107 deals, while companies amassed $1.2 billion over 79 deals in Q3. The last three months of 2023 saw less money but more deals than Q4 2024, with 87 deals at a total valuation of $838 million.
Juul Labs, which relocated to DC in 2020, accounted for $1.9 billion of last quarter’s funds. It’s the latest major raise in a trend of the e-cigarette giant amassing major capital.
PitchBook reported in July that the company raised $1.3 billion during Q2 2024, corresponding with a Securities and Exchange Commission filing from that quarter. The firm also raised $1.27 billion to close out 2023.
JUUL is the predominant investee among the other, mostly later-stage companies to report top regional raises at the end of 2024. Dustin Dunbar, a senior investment associate at the state-backed funder Virginia Venture Partners, doesn’t find venture firms coalescing around established companies especially surprising. This dynamic has persisted since 2022, following the dip in deals and funding after a major spike in 2021.
“They’re being a lot choosier when it comes to the investments that they’re willing to look at and participate in,” said Dunbar, whose employer tries to fill gaps where traditional venture capital firms have pulled back over the last few years. “COVID time saw a really fast-paced, high velocity when it comes to capital being deployed, and now it’s definitely slowed down.”
With that dynamic, founders need to understand the possible pains accompanying fundraising.
“It’s competitive to raise funding right now, which means startups need to have strong fundamentals and scalability to attract investment,” said Emily McMahan, cofounder and general partner of AIN Ventures. “With fewer deals being made, startups should continue to focus on the fundamentals of a great business model with a clear value proposition to stand out.”
Founders of early-stage startups flagged that trend, too. Julie Saltman, cofounder of the legal tech startup Standd, said it’s reassuring to see deals happening despite them mostly involving later-stage firms.
Saltman raised an undisclosed amount of capital in 2024 and is considering raising again in 2025. It all depends on the customer base and revenue Standd attracts, but if raising is avoidable, that’s ideal.
“There’s a world in which we’re able to just be sustainable with revenue,” Saltman told Technical.ly. “We’re not that far away from that point. So the idea of not having to raise a round sounds really appealing.”
AI, energy and IT reign over Q4’s top raises
Information technology providers dominated the deals in the region. That’s expected given the region’s proximity to the federal government, per Haley Bryant, who’s based in DC and works as a principal at San Francisco’s Hustle Fund.
“With the rise of AI, companies are spending more on cyber and IT, and funds are increasingly looking to back categories that power AI: data and energy, areas the DMV is known for,” Bryant told Technical.ly.
Below are the DC region’s largest deals of Q4. As always, it’s important to note that these figures may vary slightly after publication: Some deals aren’t accounted for until weeks after quarterly VC reports are published, and PitchBook may find errors in its data.
- Juul Labs, based in downtown DC, reported a raise of $1.98 billion on Nov. 25.
- X Energy raised $500 million in a Series C1 round led by Amazon’s Climate Pledge Fund. The Rockville-based company specializes in engineering small modular nuclear reactors.
- Seekr, an early-stage AI and large language model software company from Vienna, landed an investment of $74 million.
- DC-based Sublime Security raised a $60 million Series B. The company developed an AI-powered email security platform.
- Agriculture tech company EarthOptics in Arlington raised a later-stage round of $55 million. The Arlington firm, which developed sensor technology to measure soil structure and health for farmers, reported a $24 million investment back in November.
How DC fits in with national trends
Dealmaking across the country slightly increased compared to 2023, per PitchBook’s lead VC analyst Kyle Stanford.
In the DMV, the deal count decreased from 2023 to 2024, but the amount of capital increased from about $4 billion to $4.8 billion in 2024.
Established companies dominated venture capital raises in the region, which Stanford put in line with national trends. Deals like JUUL’s are also common, with 30 firms accounting for more than 68% of the United States’ total funds in 2024.
One reason for this dynamic is that companies as a whole are slower to raise, explained Tommy White, an angel investor and senior lecturer at the Kogod School of Business at American University. That’s a local and national trend.
“They’re [companies] more focused on revenue generation, protecting capital — not burning all their money,” White said.
The DMV’s deal counts decreased significantly over the past few years while valuation remained relatively consistent. This past year’s number of transactions is the lowest in at least a decade, but the valuation of the capital is the highest it’s been since 2021’s spike in venture capital.
This past year saw fewer deals at higher values compared to previous years. For example, 2020 saw 278 deals valued at $3.2 billion. In 2016, 285 deals totaled to $1.3 billion, meaning there were more deals at lower values.
What risk appetites and political upheaval mean for 2025
Looking ahead, fewer deals at a larger value will likely continue, per AIN Venture’s McMahan. But deals could ramp up — it just depends on how investors deal with risk and go about possibly diversifying their portfolio, she said.
Dunbar from Virginia Venture Partners also noted how the new presidential administration could impact interest rates, which then affect the initial public offering market. That could stimulate returns on previous investments, which would then give fund managers the leeway to make riskier bets on startups, he explained.
Dunbar has also seen more state-backed venture organizations like his become more robust throughout recent years. For example, a venture fund opened in DC at the end of 2024. This was possible thanks to the State Small Business Credit Initiative, which was reauthorized and expanded under the American Rescue Plan Act in 2021.
The remaining dollars are scheduled to arrive over the next roughly five years. While the Trump administration could pull these funds before then, Dunbar finds that outcome unlikely.
“I personally believe that the benefits really outweigh any kind of negative aspects of it,” he said. “It would be unwise, in my opinion, to pull back.”
The DMV will also likely see more venture firms pop up, per White of American University. For example, Silicon Valley powerhouse Andreessen Horowitz in 2024 announced plans to set up an office in the district, as did the Westly Group. This trend, which preceded Trump’s return to the presidency, will likely continue, he said.
“Outsiders are seeing that this is a place to be,” White said. “There’ll be a more pro-private sector focus with the new administration. That ultimately benefits early-stage companies.”